PA Consulting Group

1940-1950

PA was founded in 1943 as Personnel Administration by three Englishmen: Ernest E. Butten, Tom H. Kirkham and Dr David Seymour. Britain's war effort created great demand for munitions and goods, which had to be produced by a relatively unskilled workforce. Butten and his colleagues formed Personnel Administration Limited to provide advice to industry as to how to improve the productivity of their workers. Like the other three firms that dominated consulting in the 1940s, '50s and '60s, PA was an offshoot of the pre-war Bedaux Company. Bedaux in turn had been developed based on 'scientific management' theories of Frederick Winslow Taylor and Frank Gilbreth. Butten sought to take the mechanistic and task-orientated concepts of scientific management and add a human dimension to them. The chief idea, along the lines of Douglas McGregor's 'Theory Y', was that by involving the worker in the process of change and a suitable form of ownership, greater gains could be made both by the worker and the organisation.

PA's first assignment was to train housewives to assemble the tail gun section for the Avro Lancaster bombers, as part of Britain's policy of bringing women into the factories in order to free up male workers for the armed forces. By 1964, the company had dropped the name Personnel Administration and was known as simply PA Consulting Group.

1950-1970

PA expanded over the next 20 years, and by 1970 it was one of the world’s largest management consulting firms by headcount (closely followed by Booz Allen and McKinsey). staff can buy shares with deferred elements to bonus, 80% own them. PA had also expanded geographically, mostly along the lines of the Commonwealth: with its operation in Australia providing about a third of the firm's revenue.

In the 1960s PA diversified its business significantly by developing the use of the 'newspaper box' advertisement for recruitment.

Butten retired from PA in 1970, having earlier sold his 100% shareholding in PA to the Butten Trust in 1958. The Trust was intended as a long term guardian of PA's fortunes and an assurance that the company would be 'owned by the employees'.

1970-1992

PA's position in the industry deteriorated drastically over the following quarter century, as competitors such as McKinsey and the newer strategy consulting firms (such as Boston Consulting Group and Bain) redefined the concept of management consulting. While there were occasional years with strong revenues, the company was never very profitable. The only strong area of business during this period was PA's work advising companies on potential applications of technology to business issues. Arising out of this success, major technology centres were built in Melbourne, UK and Princeton, USA.

Towards the end of the 80s, after an upsurge in the industry, PA's management decided it wished to take the firm public. The Butten Trust, after an application to the courts in the UK, agreed to give 15% of its shares to its employees, as part of a long-term plan to float. However, the company suffered in the subsequent consulting industry downturn of 1989 to 1992 and, by the end of that downturn, PA was essentially bankrupt, with some £30 million (US$57 million) of debt, significant annual losses and a rapid outflow of staff.

1992-2007

Between 1991 and 1994, PA reduced its workforce by almost half. In 1992, Jon Moynihan was appointed as chief executive of PA, with a remit to turn the company around. With a new strategy, aggressive cost-cutting, and an industry upturn, the turnaround succeeded, and in 1995, PA made record profits.

Jeremy Asher became group CEO in 1998, and during his three-year tenure, PA grew from about 2,500 staff to just under 4,000. The firm expanded significantly in the United States through the acquisition of Hagler Bailly Inc. in 2000 for around $96 million in cash.

PA revenues suffered during the consulting recession of 2001-2004, but saw a significant recovery between 2004-2006, which helped it to increase its focus on ventures and 50% of PA's return to its main shareholder over the years 2002-2006 came from non-consulting activities. This included the sale of a number of subsidiaries including UbiNetics, Volume Product Technology, and Meridica. By 2005, the company was ranked 8th in the Sunday Times' list of Britain's biggest mid-market private firms.

2007-present

In 2008, PA suffered a high-profile loss of a USB data stick containing Home Office information on prisoners that led to the Home Office cancelling the firm’s contract. This loss followed a string of other high-profile data losses by other UK government contractors, prompting the Home Office to review its contracts

PA continues to work for a range of public and private sector clients. Government figures released in 2010 showed that the company was the second largest beneficiary of UK Government contracts to consulting firms, receiving £11million over the first year the coalition was in office. It has gained publicity for its work on analysing what it has called the zombie economy. Other work includes its annual survey of opinion in higher education, and ongoing technological innovations including a new type of round kitchen towel.

On 31 December 2013, Jon Moynihan retired as executive chairman, and was replaced by Marcus Agius, the former chairman of Barclays Bank. In March 2014 the company launched a new logo (the third in its history), a new visual identity and redesigned website. Also in March, Health Select Committee member Sarah Wollaston MP questioned how PA Consulting came to be given the entire NHS hospital patient database for England which it then uploaded to Google Maps, whose servers are based outside of the UK.

In 2015, The Carlyle Group bought a majority stake in the company, giving it a value of USD 1 billion.

Technology and innovation

The company has a strong focus on technology dating back over fifty years. Its Cambridge Technology Centre was founded by Professor Gordon Edge in 1970 and played a critical part in creating the Cambridge Phenomenon where the city became a leading centre for the UK’s technological companies.

Innovations developed at the centre over the past 50 years include: the original brushless servo motor; medical injectors that mean the patient does not need to see the needle; a self-monitoring device for people with diabetes that measures blood glucose levels; micrometers; and 4G wireless test equipment. During the Iraq War, PA Consulting developed the "Panama System" to protect UK troops from improvised explosive devices, winning the Management Consultancies Association's top prize for innovation.

PA ventures

PA's venture programme (PAGroup Ventures) was established in 2000 to exploit the ideas and intellectual capital generated from its consulting work. It was seen as unusual in continuing this approach after the dotcom boom led to other companies withdrawing from this business.

PA recent ventures include a third-generation mobile phone business called UbiNetics that was sold for a total of $133 million in 2005; and Meridica - a drug delivery system company – that was sold to Pfizer for $125 million in 2004. PA demerged its venture arm, Ipex Capital, in June 2008 although it continues to work closely with the company.

Other recent ventures include:

Exacsys, which develops solutions to improve Point of Care (PoC) diagnostic systems. One application of this technology is the self-monitoring of blood glucose (SMBG) to help people manage their diabetes.

ProcServe, which provides a cloud-based procurement system. The ProcServe Trading Network covers more than 17,000 organisations and is used by central government, and the National Police Procurement Hub, as well as commercial sector customers including Orange and Xerox.